Development & Aid, Economy & Trade, Headlines, Latin America & the Caribbean, Population

CUBA: One Step Forward, Two Steps Back

Dalia Acosta

HAVANA, May 20 2004 (IPS) - ”We are like a crab: one step forward, two steps back,” said Aurelio Fuentes, a 62-year-old Cuban who retired two years ago from a state-run company and now supports his family as a fisherman.

”Every time you think things are starting to get better, something happens and you feel like you’re about to return to 1991 or 1992,” he told IPS.

Fuentes and other Cubans are worried because the government of Fidel Castro recently announced price hikes on basic as well as non-essential items in response to U.S. measures designed to tighten the four-decade embargo against this socialist Caribbean island nation, which are expected to reduce the inflow of family remittances.

During the early 1990s, the toughest years of the economic crisis that broke out in Cuba after the collapse of the Soviet Union and east European socialist bloc – Havana’s main trading partners – the Fuentes family spent weeks at a time ”living on rice and beans.”

Although the worst of the crisis is over, the four-member family, who survive on the fish caught by Fuentes and ”the small amounts of money that a nephew occasionally sends from Miami,” have decided to limit spending to the most essential items and save up as much as they can.

”Some fishermen sell their catch to foreigners, but my customers are Cubans,” said Fuentes. ”And with the way things are now, no one’s buying. Everyone is waiting to see what will happen. My weekend catch ended up on our table.”

The few dollars he is able to bring in selling fish go towards purchases of cooking oil, powdered milk, detergent, soap and deodorant, among other basic articles that are only sold in the government chain of stores that exclusively accept dollars.

The prices of such products and others will soon rise between 10 and 15 percent, according to a circular sent by the Ministry of Interior Commerce to the managers of the dollar-only stores Wednesday.

The price rises form part of a plan with which the Cuban government aims to defend the economy from the impact of a programme to ”hasten the transition to democracy” in Cuba, announced this month by U.S. President George W. Bush.

The Cuban measures include 10 to 15 percent price hikes for a wide range of goods, including food, cleaning products, toiletries, clothing, hardware and office supplies, toys and home appliances.

Cuba’s 11.2 million people receive a limited set of guaranteed basic items sold in Cuban pesos at government shops, at subsidised prices. The goods are purchased with ration cards.

But there are other essential items that are solely available in the dollar-only stores.

The peso currently trades at 27 to the dollar in the government exchange houses, while the average monthly wage stands at around 300 pesos.

Studies estimated that in 2002, a typical family of four needed up to seven times the average monthly wage to cover their basic needs.

Around 60 percent of the population has access to dollars, but only sporadically and in varying amounts in most cases, because the money is sent home by family members abroad.

An estimated one billion dollars in expatriate remittances are sent to Cuba every year, mainly from the United States, where people of Cuban origin or descent number 1.3 million.

Although the measures announced by the Bush administration will not lower the ceiling for remittances, it will reduce the number of visits to Cuba by people with immediate family here from one a year to once every three years, while cutting the amount of money that U.S. citizens, including Cuban-Americans, can spend on lodging and food in Cuba from 164 to 50 dollars a day.

Further, people of Cuban origin or descent living in the United States will only be allowed to visit immediate family in Cuba: grandparents, grandchildren, parents, siblings, sons, daughters and spouses. No exceptions will be made to that rule, not even if other relatives are sick or dying.

”My nephew used to come often. He’s an orphan and my wife and I raised him. He’s like a son to us, but now it turns out that we’re not close enough relatives for him to visit us legally,” said Fuentes.

The new U.S. restrictions will not only affect badly needed cash flows. A large part of the Cuban community in the United States sends relatives in Cuba products not available here, such as medicines or home appliances like VCRs.

Most of the parcels are sent via the Cuban version of ”mules” – people travelling to Cuba from Miami, Florida through third countries, carrying packages and money sent by emigrés to their families or friends.

According to the Bush administration programme which was designed by the presidential Commission for Assistance to a Free Cuba, cash remittances and parcels are means by which ”the Cuban regime” gets others to support a considerable part of the Cuban population.

The U.S. plan, described as ”brutal” by Cuban authorities, was protested by more than one million Cubans in a May 14 demonstration, and drew criticism from dissidents here as well.

A statement issued Wednesday by the U.S.-based Cuban-American Commission for Family Rights said the new sanctions will create a tremendous burden and pain for families in both countries.

Economists, however, say that after the initial impact, things should largely return to normal.

”Cubans always find a way, a trick, to get around the law,” an academic who preferred not to give his name told IPS. ”Until recently, (Cubans in the United States) were only allowed to visit once a year, and some came as many as three or four times.”